Correlation Between CITY OFFICE and Boise Cascade
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and Boise Cascade at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CITY OFFICE and Boise Cascade into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and Boise Cascade, you can compare the effects of market volatilities on CITY OFFICE and Boise Cascade and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in CITY OFFICE with a short position of Boise Cascade. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and Boise Cascade.
Diversification Opportunities for CITY OFFICE and Boise Cascade
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between CITY and Boise is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and Boise Cascade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boise Cascade and CITY OFFICE is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on CITY OFFICE REIT are associated (or correlated) with Boise Cascade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boise Cascade has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and Boise Cascade go up and down completely randomly.
Pair Corralation between CITY OFFICE and Boise Cascade
Assuming the 90 days horizon CITY OFFICE REIT is expected to under-perform the Boise Cascade. In addition to that, CITY OFFICE is 1.48 times more volatile than Boise Cascade. It trades about -0.06 of its total potential returns per unit of risk. Boise Cascade is currently generating about 0.23 per unit of volatility. If you would invest 11,720 in Boise Cascade on October 23, 2024 and sell it today you would earn a total of 610.00 from holding Boise Cascade or generate 5.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
CITY OFFICE REIT vs. Boise Cascade
Performance |
| Timeline |
| CITY OFFICE REIT |
| Boise Cascade |
CITY OFFICE and Boise Cascade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and Boise Cascade
The main advantage of trading using opposite CITY OFFICE and Boise Cascade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, Boise Cascade can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Boise Cascade will offset losses from the drop in Boise Cascade's long position.| CITY OFFICE vs. AGNC INVESTMENT | CITY OFFICE vs. SOGECLAIR SA INH | CITY OFFICE vs. HK Electric Investments | CITY OFFICE vs. Virtus Investment Partners |
| Boise Cascade vs. CITY OFFICE REIT | Boise Cascade vs. OFFICE DEPOT | Boise Cascade vs. Delta Air Lines | Boise Cascade vs. Warner Music Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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